Tompkins Financial Corporation : Reports Record Quarterly and Annual Earnings

Tompkins Financial Corporation (TMP-NYSE MKT LLC)

Tompkins Financial Corporation reported diluted earnings per share of $0.96 for the fourth quarter of 2013, representing the highest quarterly earnings in Company history. Year-to-date earnings were also at a record level, with diluted earnings per share of $3.46 for the year ended December 31, 2013, up from $2.43 per share reported for the same period in 2012.

Both current and prior period results were impacted by certain non-recurring items including, but not limited to, merger related expenses associated with the acquisition of VIST Financial Corporation completed on August 1, 2012. After adjusting for non-recurring income and expenses, quarter-to-date diluted earnings per share would have been $0.91 for the fourth quarter of 2013, up from $0.81 for the same period last year. On a year-to-date basis, adjusting for non-recurring items, diluted earnings per share would have been $3.36 for the year ended December 31, 2013, compared to $3.17 for the same period last year. Additional information on non-recurring adjustments to earnings per share is included in the non-GAAP disclosure tables included in this press release.

President and CEO, Stephen S. Romaine said "We are proud to report on another record year of earnings performance for Tompkins. 2013 was a rewarding year, as it was our first full year with operations in Pennsylvania. Business activity from our Pennsylvania franchise contributed to our record performance, as did the solid performance from our New York based Banking, Insurance and Wealth Management businesses. We finished the quarter with positive trends in most business areas, leaving us well positioned as we head into 2014."

SELECTED HIGHLIGHTS FOR THE FOURTH QUARTER INCLUDED:

• Record quarter and year-to-date earnings per share
• Annual cash dividends per share increased by 5.2% in 2013, representing the 25^th consecutive year of increased dividends
• Net interest income improved during the quarter as margin increased for the third consecutive quarter, aided by solid growth in loans (up 8.1% YTD) and noninterest-bearing deposits (up 7.1% YTD)
• Provision expense was lower for the current quarter, benefiting from $977,000 of net recoveries during the quarter, as gross recoveries of $3.1 million exceeded gross charge-offs of $2.1 million
• Credit Quality improved, with nonperforming assets down 12.4% during the quarter, and 2.5% from year end 2012
• Fee based revenue from insurance, investment services, service charges on deposits and card services were all up from the same period last year

A more detailed summary of financial performance is included below. Year-to-date growth percentages are impacted by a full year consolidation of the operations of VIST Financial in 2013, versus five months in 2012.

NET INTEREST INCOME

Net interest income of $42.6 million for the fourth quarter of 2013 represents an increase of 1.9% over the same quarter last year, and 5.3%, from the third quarter of 2013. The net interest margin for the fourth quarter of 2013 was 3.78%, compared to 3.83% for the fourth quarter of 2012, and 3.63% for the third quarter in 2013. Improvement in the current period, compared to the third quarter of 2013 benefited from loan prepayment income, interest related to the payoff of a nonaccrual loan, and growth in average loans and noninterest-bearing deposits.

For the year to date period, net interest income of $161.1 million reflects an increase of 20.1% over the same period in 2012.

NONINTEREST INCOME

Noninterest income was $17.4 million for the fourth quarter of 2013, up 11.7% over the same period in 2012, and down 5.9% from the third quarter of 2013. For the year to date period, noninterest income of $69.9 million represented 30.3% of total revenue, compared to 29.0% for the same period in 2012.

Trends in key fee income business areas in the fourth quarter of 2013 compare favorably to the same quarter last year. Insurance revenue was up 1.5%, Investment Services Income was up 2.4%, deposit fees were up 11.2%, and card services revenue was up 22.4%. The decline in noninterest income from the most recent prior quarter is primarily due to net losses on sale of loans of $345,000 in the fourth quarter of 2013, compared to net gains on loans sales of $115,000 in the third quarter of 2013. The current period noninterest income benefited from a $1.3 million gain associated with certain deposit accounts that converted to alternative products during the quarter. Year-to-date other income results in 2013 also benefited from a $1.4 million pre-tax gain on redemption of the Trust Preferred debenture in September of 2013.

NONINTEREST EXPENSE

Noninterest expense was $40.3 million in the fourth quarter of 2013, up 5.4% from the same period in 2012, and 7.2% compared to the third quarter of 2013. The increase over prior periods is mainly due to higher salary and benefit expenses.

ASSET QUALITY

Asset quality trends improved in nearly all categories during the quarter. Substandard and Special Mention loans declined by $18.1 million from the most recent previous quarter, and by $43.7 million from year end 2012. Net charge-offs were $2.8 million for the year ended December 31, 2013, compared to $11.8 million of net charge-offs for the same period in 2012. The fourth quarter of 2013 saw net recoveries of $977,000, compared to net charge-offs of $7.6 million in the fourth quarter of 2012. The percentage of nonperforming assets to total assets dropped to 0.87%, down from 1.00% at September 30, 2013, and 0.92% at year-end 2012. This nonperforming asset ratio continues to compare favorably to the most recent peer averages of 1.52% published as of September 30, 2013, by the Federal Reserve¹.

The Company's allowance for originated loan and lease losses totaled $26.7 million at December 31, 2013, which represented 1.06% of total originated loans, compared to 1.16% at December 31, 2012, reflecting improved overall quality of the originated portfolio. The allowance for loan and lease losses covered 71.65% of nonperforming loans and leases as of December 31, 2013, which compares to 62.34% as of December 31, 2012.

Several banks reported losses on the sale of trust preferred securities in the fourth quarter of 2013 due to initial indications that these securities would be deemed impermissible investments under the Volcker Rule. Tompkins did not invest in pooled trust preferred securities covered by this rule and therefore was not impacted by the Volcker Rule interpretations on pooled trust preferred securities.

CAPITAL POSITION

Capital ratios remain well above the regulatory well capitalized minimums and showed improving trends over the course of the most recent quarter and over the last 12 months. Tier 1 capital to average assets improved for the fourth consecutive quarter, to 8.52% at December 31, 2013. Total risk based capital of 13.42% was up modestly from the third quarter of 2013. Tangible book value per share was $23.70 at December 31, 2013, up from $22.82 at September 30, 2013. The improvement in capital ratios was primarily driven by growth in retained earnings. Refer to Non-GAAP disclosure for additional details on tangible book value per share.

ABOUT TOMPKINS FINANCIAL CORPORATION

Tompkins Financial Corporation is a financial services company serving the Central, Western, and Hudson Valley regions of New York and the Southeastern region of Pennsylvania. Headquartered in Ithaca, NY, Tompkins Financial is parent to Tompkins Trust Company, The Bank of Castile, Mahopac Bank, VIST Bank, Tompkins Insurance Agencies, Inc., and offers wealth management services through Tompkins Financial Advisors. For more information on Tompkins Financial, visit www.tompkinsfinancial.com.

NON-GAAP MEASURES

This press release contains financial information determined by methods other than in accordance with accounting principles generally accepted in the United States of America (GAAP). Where non-GAAP disclosures are used in this press release, the comparable GAAP measure, as well as reconciliation to the comparable GAAP measure, is provided in the accompanying tables. Management believes that these non-GAAP measures provide useful information. Non-GAAP measures should not be considered a substitute for financial measures determined in accordance with GAAP and investors should consider the Company's performance and financial condition as reported under GAAP and all other relevant information when assessing the performance or financial condition of the Company. See "Tompkins Financial Corporation - Summary Financial Data (Unaudited)" tables for Non-GAAP related calculations.

"Safe Harbor" Statement under the Private Securities Litigation Reform of 1995:

This press release may include forward-looking statements with respect to revenue sources, growth, market risk, and corporate objectives. The Company assumes no duty, and specifically disclaims any obligation, to update forward-looking statements, and cautions that these statements are subject to numerous assumptions, risks, and uncertainties, all of which could change over time. Actual results could differ materially from forward-looking statements.

TOMPKINS FINANCIAL CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF CONDITION
(In thousands, except share and per share data) (Unaudited)			As of				As of
ASSETS			12/31/2013				12/31/2012
Cash and noninterest bearing balances due from banks		$	82,163			$	117,448
Interest bearing balances due from banks			721				1,482
Cash and Cash Equivalents			82,884				118,930
Trading securities, at fair value			10,991				16,450
Available-for-sale securities, at fair value (amortized cost of $1,368,736 at December 31, 2013 and $1,349,416 at December 31, 2012)			1,354,811				1,393,340
Held-to-maturity securities, fair value of $19,625 at December 31, 2013, and $25,163 at December 31, 2012			18,980				24,062
Originated loans and leases, net of unearned income and deferred costs and fees			2,527,244				2,133,106
Acquired loans and leases, covered			25,868				37,600
Acquired loans and leases, non-covered			641,172				783,904
Less: Allowance for loan and lease losses			27,970				24,643
Net Loans and Leases			3,166,314				2,929,967
FDIC Indemnification Asset			4,790				4,385
Federal Home Loan Bank stock and Federal Reserve Bank stock			25,041				19,388
Bank premises and equipment, net			55,932				54,581
Corporate owned life insurance			69,335				65,102
Goodwill			92,140				92,305
Other intangible assets, net			16,298				18,643
Accrued interest and other assets			105,523				100,044
Total Assets		$	5,003,039			$	4,837,197
LIABILITIES
Deposits:
Interest bearing:
Checking, savings and money market			2,190,616				2,144,367
Time			865,702				973,883
Noninterest bearing			890,898				831,919
Total Deposits			3,947,216				3,950,169
Federal funds purchased and securities sold under agreements to repurchase			167,724				213,973
Other borrowings, including certain amounts at fair value of $11,292 at December 31, 2013 and $11,847 at December 31, 2012			331,531				111,848
Trust preferred debentures			37,169				43,668
Other liabilities			61,460				76,179
Total Liabilities		$	4,545,100			$	4,395,837
EQUITY
Tompkins Financial Corporation shareholders' equity:
Common Stock - par value $.10 per share: Authorized 25,000,000 shares; Issued:
14,785,007 at December 31, 2013; and 14,426,711 at December 31, 2012			1,479				1,443
Additional paid-in capital			346,096				334,649
Retained earnings			137,102				108,709
Accumulated other comprehensive loss			(25,119	)			(2,106	)
Treasury stock, at cost - 105,449 shares at December 31, 2013, and 100,054 shares at December 31, 2012			(3,071	)			(2,787	)
Total Tompkins Financial Corporation Shareholders' Equity			456,487				439,908
Noncontrolling interests			1,452				1,452
Total Equity		$	457,939			$	441,360
Total Liabilities and Equity		$	5,003,039			$	4,837,197

TOMPKINS FINANCIAL CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
			Three Months Ended								Twelve Months Ended
(In thousands, except per share data) (Unaudited)			12/31/2013				12/31/2012				12/31/2013				12/31/2012
INTEREST AND DIVIDEND INCOME
Loans		$	39,684			$	39,952			$	151,711			$	124,662
Due from banks			1				19				10				32
Federal funds sold			0				0				0				2
Trading securities			117				175				589				744
Available-for-sale securities			8,138				8,214				31,360				31,232
Held-to-maturity securities			157				203				685				860
Federal Home Loan Bank stock and Federal Reserve Bank stock			211				205				749				824
Total Interest and Dividend Income			48,308				48,768				185,104				158,356
INTEREST EXPENSE
Time certificates of deposits of $100,000 or more			1,181				825				4,832				3,322
Other deposits			1,841				2,980				7,933				8,910
Federal funds purchased and securities sold under agreements to repurchase			872				1,111				3,749				4,451
Trust preferred debentures			562				798				2,599				2,094
Other borrowings			1,228				1,205				4,862				5,436
Total Interest Expense			5,684				6,919				23,975				24,213
Net Interest Income			42,624				41,849				161,129				134,143
Less: Provision for loan and lease losses			585				5,659				6,161				8,837
Net Interest Income After Provision for Loan and Lease Losses			42,039				36,190				154,968				125,306
NONINTEREST INCOME
Insurance commissions and fees			6,328				6,237				27,916				19,421
Investment services income			3,929				3,836				15,109				14,340
Service charges on deposit accounts			2,309				2,076				8,495				7,441
Card services income			2,053				1,678				7,216				6,030
Mark-to-market loss on trading securities			(66	)			(134	)			(538	)			(332	)
Mark-to-market gain on liabilities held at fair value			12				108				555				246
Net other-than-temporary impairment losses			0				(76	)			0				(196	)
Other income			2,998				2,382				10,546				7,534
(Loss) gain on sale of available-for-sale securities			(124	)			(499	)			599				324
Total Noninterest Income			17,439				15,608				69,898				54,808
NONINTEREST EXPENSES
Salaries and wages			18,582				15,427				67,200				51,700
Pension and other employee benefits			5,150				4,827				22,164				18,075
Net occupancy expense of premises			2,892				2,899				11,757				8,969
Furniture and fixture expense			1,334				1,416				5,701				4,996
FDIC insurance			813				844				3,214				2,685
Amortization of intangible assets			549				580				2,197				1,264
Merger related expenses			0				770				228				15,584
Other operating expense			10,931				11,425				40,641				34,335
Total Noninterest Expenses			40,251				38,188				153,102				137,608
Income Before Income Tax Expense			19,227				13,610				71,764				42,506
Income Tax Expense			4,905				2,416				20,777				11,090
Net Income attributable to Noncontrolling Interests and Tompkins Financial Corporation			14,322				11,194				50,987				31,416
Less: Net income attributable to noncontrolling interests			32				33				131				131
Net Income Attributable to Tompkins Financial Corporation		$	14,290			$	11,161			$	50,856			$	31,285
Basic Earnings Per Share		$	0.97			$	0.78			$	3.48			$	2.44
Diluted Earnings Per Share		$	0.96			$	0.77			$	3.46			$	2.43

Average Consolidated Statements of Condition and Net Interest Analysis (Unaudited)
			Quarter Ended								Year to Date Period Ended								Year to Date Period Ended
			December 31, 2013								December 31, 2013								December 31, 2012
			Average								Average								Average
			Balance					Average			Balance					Average			Balance					Average
(Dollar amounts in thousands)			(QTD)			Interest		Yield/Rate			(YTD)			Interest		Yield/Rate			(YTD)			Interest		Yield/Rate
ASSETS
Interest-earning assets
Interest-bearing balances due from banks		$	1,244		$	1		0.64%		$	2,005		$	10		0.50%		$	21,442		$	33		0.15%
Money market funds			-			-		0.00%			-			-		0.00%			18			-		0.00%
Securities (4)
U.S. Government securities			1,304,043			7,548		2.30%			1,326,999			28,817		2.17%			1,205,759			28,546		2.37%
Trading securities			11,360			117		4.09%			14,188			589		4.15%			18,162			744		4.10%
State and municipal (5)			89,409			1,142		5.07%			95,276			4,893		5.14%			95,095			4,946		5.20%
Other securities (5)			6,876			55		3.17%			7,714			265		3.44%			11,766			544		4.62%
Total securities			1,411,688			8,862		2.49%			1,444,177			34,564		2.39%			1,330,782			34,780		2.61%
Federal Funds Sold			-			-		0.00%			-			-		0.00%			1,837			2		0.11%
FHLBNY and FRB stock			22,453			211		3.73%			22,153			749		3.38%			18,479			824		4.46%
Total loans and leases, net of unearned income (5)(6)			3,135,714			40,129		5.08%			3,053,538			153,569		5.03%			2,382,109			125,541		5.27%
Total interest-earning assets			4,571,099			49,203		4.27%			4,521,873			188,892		4.18%			3,754,667			161,180		4.29%
Other assets			379,377								406,626								337,806
Total assets			4,950,476								4,928,499								4,092,473
LIABILITIES & EQUITY
Deposits
Interest-bearing deposits
Interest bearing checking, savings, & money market			2,222,505			1,122		0.20%			2,224,028			4,938		0.22%			1,750,444			4,854		0.28%
Time deposits			893,181			1,900		0.84%			939,630			7,827		0.83%			846,166			7,378		0.87%
Total interest-bearing deposits			3,115,686			3,022		0.38%			3,163,658			12,765		0.40%			2,596,610			12,232		0.47%
Federal funds purchased & securities sold under agreements to repurchase			168,423			872		2.05%			177,784			3,749		2.11%			200,906			4,451		2.22%
Other borrowings			253,553			1,228		1.92%			222,345			4,862		2.19%			132,746			5,436		4.10%
Trust preferred debentures			37,141			562		6.01%			41,643			2,599		6.24%			32,835			2,094		6.38%
Total interest-bearing liabilities			3,574,803			5,684		0.63%			3,605,430			23,975		0.67%			2,963,097			24,213		0.82%
Noninterest bearing deposits			853,361								806,387								681,260
Accrued expenses and other liabilities			72,867								73,117								71,226
Total liabilities			4,501,031								4,484,934								3,715,583
Tompkins Financial Corporation Shareholders' equity			447,905								442,054								375,378
Noncontrolling interest			1,540								1,511								1,512
Total equity			449,445								443,565								376,890
Total liabilities and equity		$	4,950,476							$	4,928,499							$	4,092,473
Interest rate spread								3.64%								3.51%								3.48%
Net interest income/margin on earning assets						43,519		3.78%						164,917		3.65%						136,967		3.65%
Tax Equivalent Adjustment						(895)								(3,788)								(2,824)
Net interest income per consolidated financial statements					$	42,624							$	161,129							$	134,143

Tompkins Financial Corporation - Summary Financial Data (Unaudited)
(In thousands, except per share data)			Quarter-Ended																				Year-Ended
			Dec-13				Sep-13				Jun-13				Mar-13				Dec-12				Dec-13
Period End Balance Sheet
Securities		$	1,384,782			$	1,390,233			$	1,469,315			$	1,566,510			$	1,433,852			$	1,384,782
Originated loans and leases, net of unearned income and deferred costs and fees (2)			2,527,244				2,420,695				2,309,232				2,208,346				2,133,106				2,527,244
Acquired loans and leases (3)			667,040				698,617				745,951				785,449				821,504				667,040
Allowance for loan and lease losses			27,970				26,408				25,458				24,661				24,643				27,970
Total assets			5,003,039				4,932,428				4,931,883				4,987,280				4,837,197				5,003,039
Total deposits			3,947,216				3,972,756				3,912,910				4,072,352				3,950,169				3,947,216
Federal funds purchased and securities sold under agreements to repurchase			167,724				162,117				171,498				194,091				213,973				167,724
Other borrowings			331,531				242,177				299,098				156,649				111,848				331,531
Trust preferred debentures			37,169				37,127				43,703				43,687				43,668				37,169
Shareholders' equity			457,939				444,276				431,894				446,812				441,360				457,939
Average Balance Sheet
Average earning assets		$	4,571,099			$	4,533,603			$	4,571,428			$	4,409,455			$	4,431,698			$	4,521,873
Average assets			4,950,476				4,897,678				4,965,895				4,899,727				4,901,374				4,928,499
Average interest-bearing liabilities			3,574,803				3,572,708				3,663,230				3,611,748				3,563,731				3,605,430
Average equity			449,445				434,482				447,088				443,277				443,592				443,565
Share data
Weighted average shares outstanding (basic)			14,589,120				14,515,053				14,427,838				14,374,265				14,332,672				14,477,617
Weighted average shares outstanding (diluted)			14,731,786				14,622,512				14,496,859				14,436,757				14,374,368				14,573,919
Period-end shares outstanding			14,749,097				14,692,671				14,599,558				14,447,017				14,390,801				14,749,097
Book value per share			31.05				30.24				29.58				30.93				30.67				31.05
Tangible book value per share (Non-GAAP)			23.70				22.82				22.08				23.29				22.96				23.70
Income Statement
Net interest income		$	42,624			$	40,473			$	39,826			$	38,206			$	41,849			$	161,129
Provision for loan/lease losses			585				2,049				2,489				1,038				5,659				6,161
Noninterest income			17,439				18,528				16,541				17,390				15,608				69,898
Noninterest expense			40,251				37,554				37,777				37,520				38,188				153,102
Income tax expense			4,905				5,316				5,061				5,495				2,416				20,777
Net income attributable to Tompkins Financial Corporation			14,290				14,049				11,007				11,510				11,161				50,856
Noncontrolling interests			32				33				33				33				33				131
Basic earnings per share (9)		$	0.97			$	0.96			$	0.76			$	0.80			$	0.78			$	3.48
Diluted earnings per share (9)		$	0.96			$	0.95			$	0.75			$	0.79			$	0.77			$	3.46
Nonperforming Assets
Originated nonaccrual loans and leases		$	29,875			$	33,881			$	32,100			$	32,554			$	33,388			$	29,875
Acquired nonaccrual loans and leases			8,508				8,008				6,916				4,561				4,352				8,508
Originated loans and leases 90 days past due and accruing			607				1,217				156				157				257				607
Troubled debt restructurings not included above			45				46				0				0				1,532				45
Total nonperforming loans and leases			39,035				43,152				39,172				37,272				39,529				39,035
OREO (8)			4,253				6,264				4,918				3,950				4,862				4,253
Total nonperforming assets			43,288				49,416				44,090				41,222				44,391				43,288
Tompkins Financial Corporation - Summary Financial Data (Unaudited) - continued
			Quarter-Ended																				Year-Ended
Delinquency - Originated loan and lease portfolio			Dec-13				Sep-13				Jun-13				Mar-13				Dec-12				Dec-13
Loans and leases 30-89 days past due and accruing (2)		$	5,762			$	12,193			$	9,597			$	10,888			$	7,990			$	5,762
Loans and leases 90 days past due and accruing (2)			607				1,217				156				157				257				607
Total originated loans and leases past due and accruing (2)			6,369				13,410				9,753				11,045				8,247				6,369
Delinquency - Acquired loan and lease portfolio
Covered loans and leases 30-89 days past due and accruing (3)(7)			0				1,132				1,613				3,503				1,014				0
Covered loans and leases 90 days or more past due and accruing (3)(7)			2,416				2,980				3,091				3,809				4,272				2,416
Non-covered loans and leases 30-89 days past due and accruing (3)(7)			1,532				6,887				5,591				5,738				4,249				1,532
Non-Covered loans and leases 90 days past due and accruing (3)(7)			4,557				10,521				13,324				14,026				14,438				4,557
Total acquired loans and leases past due and accruing			8,505				21,520				23,619				27,076				23,973				8,505
Total loans and leases past due and accruing		$	14,874			$	34,930			$	33,372			$	38,121			$	32,220			$	14,874
Allowance for Loan Losses - Originated loan and lease portfolio
Balance at beginning of period		$	25,722			$	24,853			$	24,598			$	24,643			$	26,632			$	24,643
Provision for loan and lease losses			(325	)			1,499				(994	)			820				5,659				1,000
Net loan and lease (recoveries) charge-offs			(1,303	)			630				(1,249	)			865				7,648				(1,057	)
Allowance for loan and lease losses (originated loan portfolio) - balance at end of period			26,700				25,722				24,853				24,598				24,643				26,700
Allowance for Loan Losses - Acquired loan and lease portfolio
Balance at beginning of period		$	686			$	605			$	63			$	0			$	0			$	0
Provision for loan and lease losses			910				549				3,483				218				0				5,160
Net loan and lease charge-offs			326				468				2,941				155				0				3,890
Allowance for loan and lease losses (acquired
loan portfolio) - balance at end of period			1,270				686				605				63				0				1,270
Total allowance for loan and lease losses			27,970				26,408				25,458				24,661				24,643				27,970
Loan Classification - Originated Portfolio
Special Mention		$	42,365			$	42,975			$	43,099			$	48,468			$	56,342			$	42,365
Substandard			35,022				37,004				41,969				43,449				45,083				35,022
Loan Classification - Acquired Portfolio
Special Mention			17,322				23,939				29,300				26,568				25,381				17,322
Substandard			33,561				42,433				55,079				47,698				45,207				33,561
Loan Classifications - Total Portfolio
Special Mention			59,687				66,914				72,399				75,036				81,723				59,687
Substandard			68,583				79,437				97,048				91,147				90,290				68,583
Tompkins Financial Corporation - Summary Financial Data (Unaudited) - continued
RATIO ANALYSIS			Quarter-Ended																				Year-Ended
Credit Quality			Dec-13				Sep-13				Jun-13				Mar-13				Dec-12				Dec-13
Nonperforming loans and leases/total loans and leases (7)			1.22	%			1.38	%			1.28	%			1.24	%			1.34	%			1.22	%
Nonperforming assets/total assets			0.87	%			1.00	%			0.89	%			0.83	%			0.92	%			0.87	%
Allowance for originated loan and lease losses/total originated loans and leases			1.06	%			1.06	%			1.08	%			1.11	%			1.16	%			1.06	%
Allowance/nonperforming loans and leases			71.65	%			61.20	%			64.99	%			66.16	%			62.34	%			71.65	%
Net loan and lease (recoveries) losses annualized/total average loans and leases			(0.12	%)			0.14	%			0.22	%			0.14	%			1.04	%			0.09	%
Capital Adequacy (period-end)
Tier 1 capital / average assets			8.52	%			8.37	%			8.16	%			8.11	%			7.95	%			8.52	%
Total capital / risk-weighted assets			13.42	%			13.32	%			13.34	%			12.93	%			12.94	%			13.40	%
Tangible common equity / tangible assets			7.11	%			6.92	%			6.65	%			6.87	%			6.96	%			7.11	%
Profitability
Return on average assets *			1.15	%			1.10	%			0.89	%			0.95	%			0.91	%			1.03	%
Return on average equity *			12.62	%			12.83	%			9.87	%			10.53	%			10.01	%			11.47	%
Net interest margin (TE) *			3.78	%			3.63	%			3.58	%			3.57	%			3.83	%			3.65	%
* Quarterly ratios have been annualized
Non-GAAP Disclosure
Reported noninterest income (GAAP)		$	17,439			$	18,528			$	16,541			$	17,390			$	15,608			$	69,898
Adjustments (pre-tax):
Gain on redemption of trust preferred			0				(1,410	)			0				0				0				(1,410	)
Gain on deposit conversion			(1,285	)			0				0				0				0				(1,285	)
Noninterest income (Non-GAAP)		$	16,154			$	17,118			$	16,541			$	17,390			$	15,608			$	67,204
Non-GAAP Disclosure
Reported net income (GAAP)		$	14,290			$	14,049			$	11,007			$	11,510			$	11,161			$	50,856
Adjustments (net of tax):
Merger related expenses			0				0				22				118				462				140
Gain on redemption of trust preferred			0				(846	)			0				0				0				(846	)
Gain on deposit conversion			(771	)			0				0				0				0				(771	)
Subtotal adjustments			(771	)			(846	)			22				118				462				(1,477	)
Net operating income (Non-GAAP)			13,519				13,203				11,029				11,628				11,623				49,379
Adjusted diluted earnings per share (Non-GAAP) (9)		$	0.91			$	0.89			$	0.75			$	0.80			$	0.81			$	3.36
Tompkins Financial Corporation - Summary Financial Data (Unaudited) - continued
Non-GAAP Disclosure			Quarter-Ended																				Year-Ended
			Dec-13				Sep-13				Jun-13				Mar-13				Dec-12				Dec-13
Reported net income (GAAP)		$	14,290			$	14,049			$	11,007			$	11,510			$	11,161			$	50,856
Merger related expenses (net of tax)			0				0				22				118				462				140
Gain on redemption of trust preferred (net of tax)			0				(846	)			0				0				0				(846	)
Gain on deposit conversion			(771	)			0				0				0				0				(771	)
Net operating income (Non-GAAP)		$	13,519			$	13,203			$	11,029			$	11,628			$	11,623			$	49,379
Amortization of intangibles (net of tax)			329				327				328				334				348				1,318
Adjusted net operating income (Non-GAAP)			13,848				13,530				11,357				11,962				11,971				50,697
Average total shareholders' equity			449,445				434,482				447,088				443,277				443,592				443,565
Less: Average goodwill and intangibles			108,729				109,277				110,037				110,687				114,644				109,676
Average tangible shareholders' equity (Non-GAAP)			340,716				325,205				337,051				332,590				328,948				333,889
Adjusted operating return on shareholders' tangible equity (annualized) (Non-GAAP)			16.13	%			16.51	%			13.52	%			14.59	%			14.48	%			15.18	%
Non-GAAP Disclosure
Total shareholders' equity (GAAP)		$	457,939			$	444,276			$	431,894			$	446,812			$	441,360			$	457,939
Less: goodwill and intangibles			108,438				108,981				109,540				110,314				110,948				108,438
Tangible shareholders' equity			349,501				335,295				322,354				336,498				330,412				349,501
Ending shares outstanding			14,749,097				14,692,671				14,599,558				14,447,017				14,390,801				14,749,097
Tangible book value per share (Non-GAAP)			23.70				22.82				22.08				23.29				22.96				23.70
Non-GAAP Disclosure		Year-to-date period ended
		Dec-13				Dec-12
Net income attributable to Tompkins Financial						$
Corporation			50,856				31,285
Adjustments (net of tax):
Accrual adjustment VISA			0				(243	)
Merger related expenses			140				9,664
Gain on redemption of trust preferred securities			(846	)			0
Gain on deposit conversion			(771	)			0
Subtotal adjustments			(1,477	)			9,421
Net operating income (Non-GAAP)			49,379				40,706
Adjusted diluted earnings per share		$	3.36			$	3.17

(1) Federal Reserve peer ratio as of September 30, 2013, includes banks and bank holding companies with consolidated assets between $3 billion and $10 billion.

(2) "Originated" equals loans and leases not included by definition in "acquired loans"

(3)"Acquired Loans and Leases" equals loans and leases acquired at fair value, accounted for in accordance with FASB ASC Topic 805. "Covered Loans" are loans for which the Company will share losses with the FDIC and consist of loans VIST Bank acquired as part of an FDIC-assisted transaction during the fourth quarter of 2010.

(4) Average balances and yields on available-for-sale securities are based on historical amortized cost.

(5) Interest income includes the tax effects of taxable-equivalent basis.

(6) Nonaccrual loans are included in the average asset totals presented above. Payments received on nonaccrual loans have been recognized as disclosed in Note 1 of the Company's consolidated financial statements included in Part I of the Company's annual report on Form 10-K for the fiscal year ended December 31, 2012.

(7) Certain acquired loans and leases that are past due are not on nonaccrual and are not included in nonperforming loans. The risk of credit loss on these loans has been considered by virtue of the Corporation's estimate of acquisition-date fair value and these loans are considered accruing as the Corporation primarily recognizes interest income through accretion of the difference between the carrying value of these loans and their expected cash flows.

(8) Includes all other real estate owned, including those balances acquired through business combinations.

(9)Earnings per share year-to-date may not equal the sum of the quarterly earnings per share as a result of rounding of average shares.

Tompkins Financial Corporation
Stephen S. Romaine, President & CEO
Francis M. Fetsko, CFO & COO
888-503-5753